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Commentary

What The Video Industry Can Learn From Spotify's Integrated Advertising

When you tune in to the ad-supported version of Spotify, the advertising seems more integrated into your experience than most digital ads. I was recently listening to music when a Gillette
advertisement featuring André 3000 invited me to listen to “André 3000’s Style Soundtrack,” which includes his commentary about “songs that talk about
style,” in hopes of inspiring you to dance, dress, and (the catch) shave stylishly. What’s clever is that the ads are specific to the publisher and extremely contextual, but they
didn’t require Gillette to produce much. The payoff? Gillette was able to reach a listener who was already engaged by tying brand and content together.

This smart technique
isn’t often used for digital video. Advertisers are either repurposing television ads or producing full-length content. Branded entertainment involves significant costs for advertisers who must
pay vendors to produce content from scratch. They then need to spend more money to find a targeted audience and hope the ad will be the next K-Swiss Kenny Powers MFCEO viral video.

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Although brands should want to scale, they should also
make sure they get their ROI. It was not long ago when Ben Silverman left NBC Universal, started Electus, and through a partnership with DumbDumb, created the Orbitz “Dirty Shorts.” The last I checked, both videos had fewer than 400,000 YouTube streams since their upload 30+ months ago. It’s
possible for brands to be successful in video production, but we don’t need bad attempts by those that become producers too soon. Integrated advertising offers the opportunity to engage
audiences through digital video at scale. It has already been a large enough feat to have audiences move from televisions to computers and devices; even simple video advertising is young. Integrated
advertising is far more meaningful in this period where consumers' behaviors are transitioning because it allows advertisers to reach audiences without needing to sell new content. The advertisers and
agencies that do take on content production should treat their content exactly as they want it received -- as actual content, not advertising.

There are less costly opportunities for
innovation through integrated advertising that may prove more memorable than branded ads. For example, instead of producing an online mini-series to market burgers to young men, Carl’s Jr. could
sponsor videos they’re already watching, such as snowboarding videos. Videos could include “this playlist is brought to you by Carl’s Jr.” on a page-takeover overlaid with
Carl’s Jr. branding and ads. Carl’s Jr. could create more of a branded experience by funding content with snowboarders displaying the logo on their snowboards.

Some brands are
finding success using similar strategies. Integrated ads could even involve using mid-rolls with the same context as the video. When you watch advertising during the People’s Choice Awards,
produced by P&G Productions (yes, the brand), you will see ads that include the singers and hosts. This builds a story that ties the brand to content audiences are already enjoying. The level of
effort and sponsorship cost is much less significant than creating content with sets, actors, cameras, post-production, and everything content producers are experts in.

It’s
possible the tendency for brands to move too quickly to content production stems from when soap operas were produced by soap companies. But their success was partially due there being only three
channels to broadcast to and reach 100% of Americans. Advertisers today must follow online audiences who are watching across millions of connected devices, reducing the chances of original content
resonating on a large scale. With integrated advertising, advertisers can focus on familiar formats. Branded entertainment should still be taken on, but the advancement to it should be a natural
progression.